Debate on more financial powers needed

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In a letter to the Scotsman newspaper, 18 leading Scots businessmen and economists have criticised the limited recommendations of the Calman Commission and the Tory tax legislation due to be published tomorrow.

The group, including Ben Thompson of Reform Scotland and Professor Andrew Hughes Hallet are insisting that the bill must properly scrutinised and that the Calman proposals on their own will not provide Scotland with the necessary levers in order to grow the economy.

Commenting, SNP MSP and finance committee member Linda Fabiani said:

“The Tory tax plan is full of holes and risks damaging the Scottish economy. It is simply not good enough for Scotland.

“These Tory tax changes fall far short of what Scotland needs and would have slashed £900 million from Scotland’s budget over the last three years.

“Before the Scotland bill has been published the Tory Government has admitted it is withholding £150 million of taxes that should be devolved to Scotland – on top of the £1.3 billion they are cutting from Scottish spending next year.”

Ms Fabiani claimed that, in its present form, the bill would see Scotland worse off and that real fiscal autonomy was the only way to grow the Scottish economy.

Ms Fabiani added:

“The Tories aided and abetted by Labour and the Lib Dems are about to introduce legislation which will result in Scotland being worse off.

“Tory, Labour and Lib Dem MSPs must listen to these respected voices who understand our economy and open up the debate over full fiscal powers. The truth is that the Tory tax plan simply falls short of what Scotland needs.

“There is a better way for Scotland than the dismal decade of cuts coming from London. With real financial responsibility we can make Scotland better and our economy stronger – unfortunately with the Tories in charge of changes to devolution this is an opportunity the opposition parties are determined to miss.”

“It is only with full fiscal responsibility and the powers of independence that we can achieve the better Scotland that we all want to see. Even if the Tories, Labour and Lib Dems do not agree there must be a full debate on all possible avenues that Scotland can turn. The Tories must not be allowed to play politics with the future of our nation.”

Notes:

A copy of the letter signed by leading economists, business leaders and entrepreneurs is below:

Letter: Scotland needs more fiscal responsibility
http://news.scotsman.com/opinion/Letter-Scotland-needs-more-fiscal.6642730.jp

The UK Government will this week publish the Scotland Bill devolving further powers to the Scottish Parliament.

The signatories to this letter are concerned that the bill will only focus on the recommendations of the Calman Commission and believe that there needs to be a greater debate during the passage of the bill through the House of Commons on the appropriate level of fiscal responsibility which should be devolved to the Scottish Parliament.

The bill will, and must, be judged on whether it contains the real economic levers to help sustain recovery and grow the economy. We do not believe that the limited recommendations of the Calman Commission provide genuine fiscal responsibility since the range of taxes devolved is too narrow and would only enable the Scottish Parliament to raise around a third of its own revenue.

The best way forward would be to devolve most current taxes to the Scottish Parliament since this would make politicians more accountable for the financial decisions they take, while giving them both the incentive and the fiscal tools necessary to achieve improved public services and faster economic growth.

Further, it would help to foster a healthy relationship between Westminster and Holyrood.

All of the main Scottish and UK parties agree that the Scottish Parliament should have greater financial powers. The debate is now about which powers should be devolved and when. We hope that the publication of this bill will lead to an open-minded discussion about what is in the best interests of Scotland and the UK as a whole.

The opportunity now exists to fashion a new, sustainable financial settlement to underpin the devolution settlement. We believe that ultimately the Scotland Bill should be measured by the economic levers and responsibility it transfers.

Signatories:

  • Ben Thomson (Reform Scotland);
  • Jim McColl (Clyde Blowers);
  • Dan Macdonald (Macdonald Estates);
  • Crawford Beveridge (Autodesk Inc and former chief executive, Scottish Enterprise);
  • Prof Sir Donald MacKay (economist); Audrey Baxter (WA Baxter and Sons);
  • Alex Hammond-Chambers (Alex Hammond-Chambers & Co);
  • Peter de Vink (EFGH Corporate Finance);
  • John McGlynn (Airlink Group);
  • Angus Tulloch (investment manager);
  • Prof Drew Scott (economist);
  • Malcolm Fraser (architect);
  • Stewart Spence (hotelier and businessman);
  • Prof David Simpson (economist);
  • Dr David Milne (Wolfson Microelectronics);
  • Prof Andrew Hughes Hallett (economist);
  • Tim Noble (Palmaris Capital);
  • Dennis MacLeod (businessman and author)